Key Points
- Benchmark KSE-100 Index gains 2,662.86 points or 1.44 per cent
- Trading boosted by speculation of upcoming policy rate cut
- Global markets subdued amid US-Europe tariff tensions
ISLAMABAD: The Pakistan Stock Exchange experienced a robust buying spree on Monday, with the benchmark KSE-100 Index climbing 2,662.86 points, or 1.44 per cent, to close at 187,761.69, extending the rally that began last week.
During the session, the index hit an intra-day peak of 187,882.04 points, reflecting strong investor confidence.
Analysts attributed the market momentum to expectations of a policy rate reduction in the upcoming Monetary Policy Committee meeting scheduled for January 26, 2026. The anticipation of lower borrowing costs encouraged buying across major sectors, particularly banking and energy stocks.
In macroeconomic developments, Pakistan’s current account recorded a deficit of $244 million in December 2025, according to the State Bank of Pakistan, reversing a surplus of $98 million in November 2025 and $454 million in December 2024. Despite the deficit, market sentiment remained buoyant as investors focused on potential monetary easing.
The previous week had seen the KSE-100 recover from early losses, closing at 185,098.83 points, a weekly gain of 689.16 points, or 0.4 per cent, following elevated regional geopolitical tensions.
Globally, equity markets were subdued. Asian indices fell as investors reacted to US President Donald Trump’s threat to impose additional tariffs on goods from eight European countries amid the Greenland conflict. However, S&P 500 and Nasdaq futures declined amid a US holiday. In Europe, futures for EUROSTOXX 50, DAX, and FTSE slipped between 0.6 per cent and 1.3 per cent, with Japan’s Nikkei down 1.4 per cent. The MSCI Asia-Pacific index, outside Japan, lost 0.3 per cent.
Trump announced the proposed additional 10 per cent import levies effective February 1, escalating to 25 per cent on June 1, if no agreement is reached. European nations denounced the move as coercive, with France signalling potential retaliatory measures on US trade and investments. Analysts noted that European holdings of US bonds and equities total around $8 trillion, nearly double the combined rest of the world, which could influence capital flows if tensions rise.
